Inventec will sell its stake in ZT Systems to AMD, receiving cash and shares

As part of the deal for AMD to purchase server and cloud solutions provider ZT Systems, Inventec, which owns a 10% stake in the latter, expressed its readiness to sell its stake for $411,289,377. According to DigiTimes, Inventec will also receive AMD shares in addition to money.

Inventec is selling its stake to strengthen its financial position and likely focus on other areas of its business. The total amount of AMD’s transaction to purchase ZT Systems is $4.9 billion, 75% of the cost will be paid in cash assets, the remaining 25% in shares of AMD itself. As part of the transaction, Inventec will sell common shares and stock options in ZT Systems. Upon completion of the transaction, the company will also receive approximately 884 thousand shares of AMD.

Image source: ZTSYSTEMS

Since AMD has expressed its intention to sell the part of the ZT Systems business that is directly responsible for production, it is possible that Inventec will subsequently want to buy it out. The company itself refused to comment on the assumption. Wistron, which also produces servers for hyperscalers, when asked about the possible transfer of ZT Systems production facilities to it, said that the initiative now belongs to AMD and there are no plans for such a “takeover” yet.

Inventec began supplying servers to key cloud providers in 2019, including Amazon, Microsoft and Meta✴, having also invested in ZT Systems. Later, Inventec and ZT Systems collaborated to produce servers for NVIDIA. In this chain, Inventec was responsible for the installation of motherboards and general preparation of chassis for servers (level L6), and ZT Systems was responsible for the final assembly and testing of finished servers (L10), as well as for the integration of systems at the final stage (L11).